NatWest has agreed to buy a £2.5bn portfolio of prime UK residential mortgages from Metro Bank.
The deal, for up to £2.4bn in cash, will see around 10,000 customer accounts transfer to NatWest from Metro, although the accounts will continue to be serviced by the latter lender.
NatWest says the mortgages have a weighted average current loan-to-value of around 62%, and expects the deal to be completed in the second half of this year, subject to regulatory approval.
NatWest Group chief executive Paul Thwaite says: “This transaction is a further opportunity to accelerate the growth of our retail mortgage book within our existing risk appetite, with attractive returns.
“It is in line with our strategic priorities and builds on our recent acquisition from Sainsbury’s Bank.
“We are focussed on a smooth transition and have a strong track record of successful integration with Metro Bank, following our previous acquisition of mortgages in 2020.”
The sale by Metro comes after it had pulled a prospective £3bn mortgage portfolio sale in December, citing “the prevailing market environment”.
Last month, NatWest agreed to buy most of Sainsbury’s Bank for £125m.
The high street bank acquired £2.5bn of gross customer assets from the supermarket, comprising £1.4bn of unsecured personal loans and £1.1bn of credit card balances, together with around £2.6bn of customer deposits.
However, the move did not include an exchange of home loans.
In 2020, NatWest previously bought a £3bn portfolio of prime UK mortgages from Metro, which transferred 13,000 customers to the larger high street bank.
NatWest also reports its first-half results today.
